What Percentage of Podcasts Make Money?

Did you know that most podcasts don’t make money? This might come as a surprise given the popularity of the medium, but the reality is stark. Only a small percentage of podcasts generate revenue, and an even smaller fraction make significant profits. Yet, podcasting remains a compelling space for creators, with unique opportunities for monetization for those who crack the code.

The key to success lies in the numbers, but it's not just about listeners. Understanding your target audience, engagement levels, and choosing the right monetization model is crucial. On average, less than 20% of podcasts are monetized in any significant way, though the exact figure fluctuates based on the source. So, why is it that the vast majority of podcasters fail to make money?

The Harsh Reality of Podcasting Finances

Let’s start with the numbers. Out of over 4 million podcasts globally, about 500,000 are considered "active," with episodes released in the last 90 days. However, only 10-20% of these active podcasts are monetized. This means that 80-90% of podcasts are hobby projects or passion-driven ventures with no significant financial return.

The podcast industry, despite its rapid growth, is often misunderstood. Many aspiring podcasters believe that a microphone and an idea are enough to earn money. But the reality is more complex. While the barriers to entry are low, making money from podcasting takes a combination of audience growth, strategic partnerships, and diverse revenue streams.

Why Don’t Most Podcasts Make Money?

One of the primary reasons most podcasts don’t make money is the lack of audience size. In advertising-based models, podcasts need a substantial listener base to attract sponsorships or ad placements. For instance, advertisers often look for shows with at least 5,000 to 10,000 downloads per episode before they consider investing.

But even when a podcast has an engaged audience, it might not be the right type of audience for monetization. Niche podcasts may have fewer listeners, but if those listeners are highly engaged and aligned with a specific market, they can be more profitable than broader shows with larger but less engaged audiences.

The Different Monetization Models

There are several ways podcasters can make money, and understanding the different models is key to success.

1. Advertising and Sponsorships: The most common revenue model. Advertisers pay podcasters to mention or promote their products in episodes. CPM (Cost per Thousand) is the standard pricing model, with podcasts earning between $18-$50 per thousand downloads. However, this model only works if the podcast has significant listenership.

2. Listener Support and Crowdfunding: Platforms like Patreon allow creators to earn directly from their audience. This model works well for podcasts with dedicated, passionate fanbases. According to Patreon, successful podcasters on their platform can make between $1,000 and $10,000 per month, depending on the number of subscribers and tiers offered.

3. Merchandising: Selling branded products can be an additional revenue stream, though it requires an already-established audience. This can include anything from T-shirts to exclusive content or behind-the-scenes access.

4. Premium Content and Subscriptions: Some podcasters create paywalled content, offering additional or exclusive episodes for a fee. Platforms like Apple Podcasts and Spotify now offer ways to monetize through premium subscriptions.

5. Affiliate Marketing: Podcasts promote products or services and earn a commission on any sales made through their referral. This method works well if the products align with the podcast’s content and audience.

Success Stories: What Sets Them Apart?

Podcasts like “The Joe Rogan Experience” or “My Favorite Murder” bring in millions in revenue, but what sets them apart? It’s not just about the numbers—it’s about the strategy. These shows have diverse income streams, from sponsorships to merchandise, live events, and subscription models. But most importantly, they have highly engaged audiences who are willing to support them.

For example, Joe Rogan famously signed an exclusive deal with Spotify worth $100 million, but his show had already been monetizing through ads, merchandise, and live events long before that. He cultivated a massive audience that was not only large but fiercely loyal. Engagement is often more important than raw numbers when it comes to monetization.

The Future of Podcasting: More Money, More Problems?

As podcasting continues to grow, more and more shows are looking to monetize. The industry is expected to be worth over $4 billion by 2025, but the gap between successful and struggling podcasters will likely widen. With increased competition and higher listener expectations, those who are serious about making money in the space will need to adopt more sophisticated strategies.

Podcasts can no longer rely on simple ad placements to make money. Diversification is essential. As we move forward, we’re likely to see more podcasters adopting models like subscription services, crowdfunding, and exclusive content to stay financially viable.

Key Takeaways

1. Only 10-20% of podcasts make any significant money, with the vast majority operating as passion projects.
2. Advertising is still the most common revenue model, but it requires substantial audience numbers.
3. Listener support and crowdfunding provide an alternative path, especially for niche or highly engaged audiences.
4. Diversifying income streams—through merchandise, premium content, and live events—is key to sustainable podcasting revenue.
5. The future of podcasting will likely see more sophisticated monetization strategies and increased competition.

Podcasting can be a rewarding venture, but it's essential to go in with realistic expectations and a well-thought-out strategy. Whether you're just starting or looking to scale, understanding the landscape and focusing on engagement, not just audience size, can make all the difference.

Want to make money with your podcast? Start by thinking beyond ads and looking at your audience as your biggest asset. Build trust, create valuable content, and monetize through multiple channels. It’s not easy, but with the right approach, it’s possible.